Live Poultry Dealer Disclosure Document

U.S. DEPARTMENT OF AGRICULTURE AGRICULTURAL MARKETING SERVICE FAIR TRADE PRACTICES PROGRAM PACKERS AND STOCKYARDS DIVISION

6100 LIVE POULTRY DEALER DISCLOSURE DOCUMENT FORM INSTRUCTIONS

This form is for use by any entity engaged in business as a Live Poultry Dealer and is required by 9 CFR 201.102 of the regulations under the Packers and Stockyards Act, 1921 (Act), as amended and supplemented, to provide broiler growers the required disclosure information. Submit the Live Poultry Dealer Disclosure Document, along with all required disclosure documents to each of the broiler growers under contract to you in the order, form, and content as instructed below and in § 201.102. Copies of this form may be obtained from the regional office covering your area, or on our website: https://www.ams.usda.gov/resources/forms.

Regional Offices of the Packers and Stockyards Division Agricultural Marketing Service, Fair Trade Practices Program
Eastern Regional Office 75 Ted Turner Drive SW, Ste 230 Atlanta, GA 30303-3308 Telephone: (404) 562-5840 FAX: (404) 562-5848 E-mail: [email protected]	Midwestern Regional Office 210 Walnut Street, Room 317 Des Moines, IA 50309-2110 Telephone: (515) 323-2579 FAX: (515) 323-2590 E-mail: [email protected]	Western Regional Office 3950 Lewiston St., Suite 200 Aurora, CO 80011-1556 Telephone: (303) 375-4240 FAX: (303) 371-4609 E-mail: [email protected]
States Covered	States Covered	States Covered
AL, AR, CT, DC, DE, FL, GA, LA, MA, MD, ME, MS, NC, NH, NJ, NY, PA, PR, RI, SC, TN, VA, VT, WV	IA, IL, IN, KY, MI, MN, MO, ND, NE, OH, SD, WI	AK, AZ, CA, CO, HI, ID, KS, MT, NM, NV, OK, OR, TX, UT, WA, WY

A. Prominent Disclosures (Cover Page(s)) Should Include Items A1-A13.

The following information is required under 9 CFR 201.102(b)(1), (2), and (3).

A1. Company Name

A2. Business Type

A3. Business Address

A4. Contact Name

A5. Telephone Number

A6. Company Email Address

A7. Website Address

A8. Grower Name

A9. Term of Contract (dates)

A10. The following statement, as required under section § 201.102(b)(4):

“The income from your poultry farm may be significantly affected by the number of flocks the poultry company places on your farm each year, the density or number of birds placed with each flock, and the target weight at which poultry is caught. The poultry company may have full discretion and control over these and other factors. Please carefully review the information in this document.”

A11. Under the terms of this broiler growing arrangement, as required under § 201.102(b)(5):

1. Minimum number of flocks placed on the grower’s farm each year

2. Minimum stocking density of each flock placed on the grower’s farm

A12. The applicable of one of the following two statements, as required under § 201.102(b)(6):

a. “This disclosure document summarizes certain provisions of your broiler growing arrangement and other information. You have the right to read this disclosure document and all accompanying documents carefully. At least 14 calendar days before the live poultry dealer executes the broiler growing arrangement (provided that growers may waive up to 7 calendar days of that time period), the poultry company is required to provide you with: (1) this disclosure document, and (2) a copy of the broiler growing arrangement.” OR

b. “This disclosure document summarizes certain provisions of your broiler growing arrangement and other information. You have the right to read this disclosure document and all accompanying documents carefully. The live poultry dealer is required to provide this disclosure document to you simultaneously with (a) a copy of the broiler growing arrangement, (b) any new or modified housing specifications that would require you to make an original or additional capital investment, and (c) a letter of intent.”

A13. Statement and Sentence (in bold) as required under § 201.102(b)(7) and (8):

“Even if the broiler growing arrangement contains a confidentiality provision, by law you still retain the right to discuss the terms of the broiler growing arrangement and the Live Poultry Dealer Disclosure Document with a Federal or State agency, your financial advisor or lender, your legal advisor, your accounting services representative, other growers for the same live poultry dealer, and your immediate family or business associates. A business associate is a person not employed by you, but with whom you have a valid business reason for consulting when entering into or operating under a broiler growing arrangement.” AND

“Note that USDA has not verified the information contained in this document. If this disclosure by the live poultry dealer contains any false or misleading statement or a material omission, a violation of Federal and/or State law may have occurred.”

B. Required Disclosures Following Cover Pages - Items B1-B11:

B1. A summary of litigation over the prior 5 years between the live poultry dealer and any broiler grower; including the nature of the litigation, its location, the initiating party, a brief description of the controversy, and any resolution, as required under § 201.102(c)(1).

B2. A summary of all bankruptcy filings in the prior 5 years by the live poultry dealer and any parent, subsidiary, or related entity of the live poultry dealer, as required under § 201.102(c)(2).

B3. A statement that describes the live poultry dealer’s policies and procedures regarding the potential sale of the broiler grower’s facility or assignment of the broiler growing arrangement to another party, including the circumstances under which the live poultry dealer will offer the successive buyer a broiler growing arrangement, as required under § 201.102(c)(3).

B4. A statement describing the live poultry dealer’s policies and procedures, as well as any appeal rights arising from the events described in § 201.102(c)(4)(i) through (c)(4)(vi). If no policy or procedure exists, the live poultry dealer will acknowledge “no policy exists” relating to the items in § 201.102(c)(4)(i) through (c)(4)(vi).

B5. A table showing the average annual broiler grower turnover rates for the previous calendar year and the average of the 5 previous calendar years at a company level and at a local complex level, as required in § 201.102(c)(5). Specific computation instructions and an example table for annual grower turnover rates appear in the Appendix to this form.

B6. Tables showing average annual gross payments to broiler growers at the local complex for each of the 5 previous years. The tables must express average payments in U.S. dollars per farm facility square foot. The tables must be organized by year, housing specification tier (lowest to highest), and quintile (lowest to highest), or by mean and standard deviation, as required under § 201.102(d)(1). Specific computation instructions and an example table for average annual gross payments by quintile appear in the Appendix to this form.

B7. If poultry housing specifications for broiler growers under contract with the complex are modified such that an additional capital investment may be required, or if the 5-year averages provided under § 201.102(d)(1) do not accurately represent projected grower gross annual payments under the terms of the applicable broiler growing arrangement for any reason, provide the following additional information, as required under § 201.102(d)(2):

(a) Tables providing projections of average annual gross payments to broiler growers under contract with the complex with the same housing specifications for the term of the broiler growing arrangement at five quintile levels, or by mean and standard deviation, expressed as dollars per farm facility square foot. AND

(b) An explanation of why the annual gross payment averages for the previous 5 years, as provided under § 201.102(d)(1), do not provide an accurate representation of projected future payments, including the basic assumptions underlying the projections provided under § 201.102(d)(2)(i).

B8. A summary of information the live poultry dealer collects or maintains relating to grower variable costs inherent in broiler production, as required in § 201.102(d)(3).

B9. Current contact information for the State university extension service office or the county farm advisor’s office that can provide relevant information about broiler grower costs and broiler farm financial management in the broiler grower’s geographic area, as required under § 201.102(d)(4).

B10. Certification, as required under 201.102(f)(2):

“I certify that, to the best of my knowledge, ____________________________ [company name] has established, maintains, and enforces the governance framework and that based on my knowledge, the Live Poultry Dealer Disclosure Document does not contain any untrue statement of a material fact or omit to state a material fact which would render it misleading.”

B11. Broiler Grower’s Signature page that contains the following statement, as required in 201.102(g)(1) and (2):

“If the live poultry dealer does not deliver this disclosure document within the timeframe specified herein, or if this disclosure document contains any false or misleading statement or a material omission (including any discrepancy with other oral or written statements made in connection with the broiler growing arrangement), a violation of Federal and State law may have occurred. Violations of Federal and State laws may be determined to be unfair, unjustly discriminatory, or deceptive and unlawful under the Packers and Stockyards Act, as amended. You may file a complaint at farmerfairness.gov or call 1-833-DIAL-PSD (1-833-342-5773) if you suspect a violation of the Packers and Stockyards Act or any other Federal law governing fair and competitive marketing, including contract growing, of livestock and poultry. Additional information on rights and responsibilities under the Packers and Stockyards Act may be found at www.ams.usda.gov.”

Appendix to Form PSD-6100

Specific Computation Instructions and Examples for § 201.102(c) and (d) (Items B1 through B9)

Annual Grower Turnover Rates (201.102(c)(5))¹

To calculate grower turnover rates:

1. Define the time period for the calculation (previous-year or five-year average annual).

2. Calculate the average number of growers during the period at a company level and at a complex level by averaging the number of growers at the beginning and end of the period.

3. Determine the total number of grower separations during the period at a company level and at a local complex level.

4. Use the Grower Turnover Rate formula to calculate the grower turnover rate at a company level and at a local complex level.

5. Complete the Company and Complex Grower Turnover Rate table.

Grower Turnover Rate = X 100

Example Table:

Company and Complex Grower Turnover Rate

Company Name
Previous-Year Annual Grower Turnover Rate
Five-Year Average Annual Grower Turnover Rate*
Complex Name**
Previous-Year Annual Grower Turnover Rate
Five-Year Average Annual Grower Turnover Rate
Complex Name**
Previous-Year Annual Grower Turnover Rate
Five-Year Average Annual Grower Turnover Rate*

* If a live poultry dealer has been in operation for fewer than 5 years, the live poultry dealer should report the average for the number of years it has been in operation.

** Live poultry dealers should lengthen or shorten the table as needed to include each local complex (if more than one) for a prospective or current broiler grower.

Average Annual Gross Payments by Quintile (201.102(d)(1)(A))²

To calculate average annual gross payments and quintiles:

1. Group growers according to the housing specification affiliated with their broiler growing arrangement;

a. Include all growers under contract for a complete calendar year and growers under flock-to-flock broiler growing arrangements during that year, and

b. Exclude growers whose housing specifications changed during the calendar year from the calculation for that year.

2. Sum all gross payments to each grower during the calendar year to determine each grower’s annual gross payments.

3. Divide each grower’s total annual gross payments by the square footage of floor space of the grower’s farm facility to reflect dollars per farm facility square foot of floor space.

4. Rank the annual gross payments per square foot in numerical order from lowest to highest.

5. To calculate the upper bound of the first quintile, multiply the total number of growers by 0.2, and round to the nearest whole number to determine the highest ranking annual gross payment per square foot in the first quintile. All annual gross payments ($/ft²) at this upper bound and below form the first quintile.

6. To calculate the upper bounds of the second, third, and fourth quintiles, multiply the total number of growers by 0.4, 0.6, and 0.8, respectively and round to the nearest whole number to determine the highest ranking annual gross payments per square foot for each quintile. The lower bounds for each quintile are simply the next highest annual gross payments per square foot above the upper bound of the previous quintile. All remaining annual gross payments per square foot above the upper bound of the fourth quintile form the fifth quintile.

7. Group each annual gross payment per square foot into each quintile using the respective lower and upper bounds calculated above.

8. Calculate the average of the annual gross payments per square foot in each quintile.

9. Place the average of the annual gross payments per square foot for each quintile into tables based on the following example table.

Example Table for a Local Complex:

Quintiles of Average Annual Gross Payment per square foot for Calendar Year ____.*

	Complex and Housing Information	Quintiles	Average Annual Gross Payments **
Complex name (City, State, complex)
	Short description of Housing specification	1st quintile (lowest average annual gross payments) (lowest 20%)	$___ per farm facility square foot
		2nd quintile (next 20%)	$___ per farm facility square foot
		3rd quintile (next 20%)	$___ per farm facility square foot
		4th quintile (next 20%)	$___ per farm facility square foot
		5th quintile (highest average annual gross payments) (highest 20%)	$___ per farm facility square foot
	Short description of Housing specification	1st quintile (lowest average annual gross payments) (lowest 20%)	$___ per farm facility square foot
		2nd quintile (next 20%)	$___ per farm facility square foot
		3rd quintile (next 20%)	$___ per farm facility square foot
		4th quintile (next 20%)	$___ per farm facility square foot
		5th quintile (highest average annual gross payments) (highest 20%)	$___ per farm facility square foot
	Short description of Housing specification	Same information as above	Same information as above
Complex name (City, State, complex)
	Same information as above for each Housing specification	Same information as above	Same information as above
Complex name (City, State, complex)
	Same information as above for each Housing specification	Same information as above	Same information as above

* Live poultry dealers should prepare this table for each of the five previous years.

**Live poultry dealers should lengthen or shorten the table as needed to include each housing specification at each complex.

Mean and Standard Deviation of Annual Gross Payments per Square Foot (201.102(d)(1)(B))

To calculate the mean and standard deviation of annual gross payments per square foot³:

1. Group growers according to the housing specification affiliated with their broiler growing arrangements;

a. Include all growers under contract for a complete calendar year and growers under flock-to-flock broiler growing arrangements during that year, and

b. Exclude growers whose housing specifications changed during the calendar year from the calculation for that year.

2. Sum all gross payments to each grower during the calendar year to determine each grower’s annual gross payments.

3. To get annual gross payments for each grower on a U.S. dollars per farm facility square foot basis ($/ft²), divide each grower’s total annual gross payments by the square footage of floor space of the grower’s farm facility to reflect dollars per farm facility square foot of floor space.

4. To calculate the mean of annual gross payments, sum the annual gross payments ($/ft²) for each grower during the calendar year and then divide the sum by the number of growers.

5. To calculate the standard deviation from the mean, s, use the following formula and instructions:

s = where

• s = standard deviation;

• = the sum of over all individuals;

• X_i = annual gross payments ($/ft²) to each individual grower;

• = mean of annual gross payments ($/ft²) of all growers from number 4 above;

• n – 1 = number of growers minus 1.

6. Subtract the mean from the annual gross payment of each grower to get the deviation from the mean of each grower’s annual payment.

7. Square each deviation from the mean of each grower’s annual payment.

8. Sum all the squared deviations.

9. Divide the sum of the squared deviations by the number of growers minus 1, n-1.

10. Take the square root of the quotient to get the standard deviation, s.

11. Place the mean and standard deviation of the annual gross payments per square foot ($/ft²) into tables based on the following example table.

Example Table for a Local Complex:

Mean and Standard Deviation of Annual Gross Payment per square foot ($/ft²) for

Calendar Year ____.*

	Complex and Housing Information	Mean	Standard Deviation **
Complex name (City, State, complex)
	Short description of Housing specification	$___ per farm facility square foot	$___ per farm facility square foot
	Short description of Housing specification	$___ per farm facility square foot	$___ per farm facility square foot
	Short description of Housing specification	$___ per farm facility square foot	$___ per farm facility square foot
Complex name (City, State, complex)
	Same information as above for each Housing specification	Same information as above	Same information as above

* Live poultry dealers should prepare this table for each of the five previous years.

**Live poultry dealers should lengthen or shorten the table as needed to include each housing specification at each complex.

According to the Paperwork Reduction Act of 1995, an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid OMB control number. The valid OMB control number for this information is 0581-NEW. The time required to complete this information collection is estimated to average .90 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information.

In accordance with Federal law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, this institution is prohibited from discriminating on the basis of race, color, national origin, sex, age, disability, and reprisal or retaliation for prior civil rights activity. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means of communication for program information (e.g., Braille, large print, audiotape, American Sign Language, etc.) should contact the responsible State or local Agency that administers the program or USDA’s TARGET Center at (202) 720-2600 (voice and TTY) or contact USDA through the Federal Relay Service at (800) 877-8339. Additionally, program information is also available in languages other than English.

To file a complaint alleging discrimination, complete the USDA Program Discrimination Complaint Form, AD-3027, found online at http://www.ascr.usda.gov/complaint_filing_cust.html, or at any USDA office or write a letter addressed to USDA and provided in the letter all of the information requested in the form. To request a copy of the complaint form, call (866) 632-9992. Submit your completed form or letter to USDA by: (a) mail: U.S. Department of Agriculture, Office of the Assistant Secretary for Civil Rights, 1400 Independence Avenue, SW, Washington, D.C. 20250-9410; (b) fax: (202) 690-7442; or (c) email: [email protected].

1 AMS has provided specific computation instructions so that all live poultry dealers calculate annual grower turnover rates using the same formula. This ensures consistency across all live poultry dealers in the calculation and disclosure to broiler growers. This consistency also ensures that broiler growers can accurately compare annual grower turnover rates across several live poultry dealers.

2 AMS has provided specific computation instructions so that all live poultry dealers calculate average annual gross payments by quintile using the same computation instructions. AMS is aware that different computer applications (Excel, SAS, for example) use different algorithms to calculate quintiles, which results in slightly different calculation results. Providing live poultry dealers with specific instructions to use the same computation instructions ensures consistency across all live poultry dealers in the calculation and disclosure to broiler growers. This consistency also ensures that broiler growers can accurately compare average annual gross payments by quintile across several live poultry dealers.

3 If there are nine or fewer growers at a local complex, live poultry dealers should report only the mean of annual gross payments per square foot and one standard deviation from the mean for each of the five previous years.

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